London’s financial services sector attracted more foreign investment last year than any of its global counterparts, according to a new report by the city’s governing body.
The city’s financial district secured more foreign direct investment (FDI) last year than eight other major hubs, according to a report from the City of London Corporation published Wednesday.
It said that London secured 55 FDI projects in 2017 — more than twice the number of those received by New York and Frankfurt. An FDI project is generally an overseas investment into a new or existing project where the foreign investor secures majority-ownership.
Despite Brexit uncertainty, London attracted 28 percent of all FDI projects secured by the nine financial centers assessed (London, Dublin, Frankfurt, Hong Kong, Luxembourg, New York City, Paris, Singapore, and Tokyo).
Singapore first for total value
However, the total value of foreign investment into the city’s financial services sector was £4.23 billion ($5.54 billion) last year — placing the city in second place to Singapore, which received capital investments from overseas worth £4.73 billion.
Hong Kong’s financial services received investments worth £3.37 billion, while New York’s FDI totalled £0.71 billion — placing the city behind Tokyo, Dublin and Paris. Meanwhile, financial services across the U.K. secured overseas investments worth £8.6 billion between 2013 and 2017.
London’s market continued to boom amid political tension, with financial services exports totalling £68 billion in 2017 — more than New York and Singapore combined.
Catherine McGuinness, policy chairman of the City of London Corporation, said the U.K.’s financial services district was a “magnet” for foreign investors, helping to generate major capital projects — long-term projects that help companies build or maintain assets such as facilities and equipment.
“The U.K. leads the world when it comes to exporting financial services and we have a number of strengths that appeal to investors,” she said in a press release Wednesday.
“We cannot, however, afford to take this position for granted. Foreign investment flows can shift quickly so it is vital that we secure a positive Brexit deal that provides confidence and clarity for the sector. This will help to attract investment in the future of London and the U.K.”
In June, the U.K.’s Department for International Trade published figures showing that foreign investment into the wider U.K. economy fell by 9 percent between 2016/17 and 2017/18.
New investments were down by 5 percent, with mergers and acquisitions falling by 13 percent. The biggest overseas investor into the U.K. was the U.S., according to the department’s report.
The City of London Corporation selected the world’s top nine financial services destinations for its study.